Legislature(2015 - 2016)BARNES 124
03/26/2015 08:00 AM House COMMUNITY & REGIONAL AFFAIRS
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| Audio | Topic |
|---|---|
| Start | |
| HB118 | |
| HB149 | |
| Adjourn |
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
| *+ | HB 149 | TELECONFERENCED | |
| + | TELECONFERENCED | ||
| + | HB 118 | TELECONFERENCED | |
HB 118-MUNI ENERGY IMPROVEMNT ASSESSMNTS/BONDS
8:02:35 AM
CHAIR TILTON announced that the first order of business would be
HOUSE BILL NO. 118, "An Act adopting the Municipal Property
Assessed Clean Energy Act; authorizing municipalities to
establish programs to impose assessments for energy improvements
in regions designated by municipalities; imposing fees; and
providing for an effective date."
[Before the committee is CSHB 118(ENE).]
8:03:07 AM
GENE THERRIAULT, Deputy Director, Energy Policy, Alaska Energy
Authority (AEA), Department of Commerce, Community & Economic
Development (DCCED), explained that this legislation proposes an
entirely new section to allow municipalities with property tax
authority to implement a Property Assessed Clean Energy (PACE)
financing mechanism. This mechanism would help commercial
properties make energy improvements to their properties in order
to lower their overall energy costs. In 2010, the Alaska State
Legislature established a goal for the state to improve overall
energy efficiency by 15 percent by the year 2020. Although [the
state] is aggressively moving forward to achieve that goal, not
a lot of traction has been achieved in assisting/encouraging
commercial properties to make energy improvements. There are a
number of programs that do assist with energy efficiency
improvements for residential properties, state-owned buildings,
municipally-owned buildings, and nonprofits. He related that
about the only program for commercial properties is the
commercial facility energy audit program, which encourages
owners of commercial buildings to have energy audits on their
properties. Although about 150 properties throughout the state
have availed themselves of these energy audits, there has been
[little] follow through or action on those recommendations.
Therefore, there was review in terms of what can be done to
assist property owners to follow through [with the energy audit
recommendations]. For those commercial properties that have had
the energy audit and made the recommended changes to their
buildings generally achieve a 30 percent reduction in their
overall energy costs annually. The aforementioned, he opined,
means there is a lot of value to capture. Upon reviewing what
other states have done in this area, AEA has identified PACE
financing as a means to help commercial properties move forward
to achieve energy efficiency. Mr. Therriault explained that
PACE allows local governments and lenders to make loans to
commercial properties the repayment of which is collected
through a mechanism in which a voluntary assessment is added to
the annual property tax of the commercial property. Collecting
the loan payment with the property tax provides the full
collection powers of the property tax, and thus there is a low
default rate and low risk level. Mr. Therriault opined that low
risk loans one would expect low risk capital, which means a
lower interest rate. Another benefit of the use of the property
tax as a mechanism to collect the PACE loan is the ability to
stretch out the repayment period. With PACE, the repayment
period is generally 10-20 years. Mr. Therriault explained that
the goal is to incentivize commercial properties to make
improvements and experience immediate positive cash flow such
that the savings in energy is more than the cost of the loan
repayment.
8:09:00 AM
EMILY FORD, Public Outreach Liaison, Alaska Energy Authority,
Department of Commerce, Community & Economic Development,
referring to the slide presentation entitled "HB 118 Property
Assessed Clean Energy (PACE)," directed attention to slide 2
entitled "What is Commercial PACE?" and highlighted that PACE is
a voluntary program for municipalities, commercial property
owners, and lenders. She also highlighted that mortgage holder
consent is required prior to applications being approved and
assessments placed. The improvements, she noted, can include
lighting upgrades, renewable energy, conversion to natural gas,
high-efficiency boilers, and additional energy efficiency
improvements. The repayment obligation transfers with the sale
of the property, she related. Ms. Ford then moved on to slide 3
entitled "Benefits" and opined that the real benefit to PACE is
that the longer repayment period allows the building owner to
recognize immediate operating savings while repaying the debt.
She pointed out that under PACE traditional lending sources can
be used and in Alaska, PACE provides consistency with state
energy policy, energy efficiency, and renewable energy goals.
As noted on slide 4, 31 states have authorized PACE programs.
She pointed out that the PACE program proposed in HB 118 applies
to commercial properties and state legislatures must provide
authority for local governments to establish and operate
commercial PACE programs. Municipalities, however, have the
flexibility to create the program and select financing models.
As more states look to PACE financing mechanisms as a way to
incent energy efficiency, there's a wealth of information online
including sites such as PaceNow.org and C-Pace.com.
Furthermore, the U.S. Department of Energy has a packet of
information that includes sample contracts, potential marketing
materials, and a how-to manual for lenders, commercial building
owners, and local governments. Slide 5 provides examples of the
different types of PACE financing models, such as a local
government-driven model in which the program is run through a
government office, PACE office, or the property assessment
office. In the aforementioned model, the municipality would
interface with the commercial property owners and potential
lenders and bond financing could be used for the efficiency
projects. There is also the possibility of a private-sector
driven model in which a third party administrator is under
contract with the local government to administer the program.
Under this model, the PACE program would exclusively use private
financing and local lenders. However, the traditional PACE
model is a hybrid model in which all potential funding sources
are identified including bonds, revolving loan funds, or private
capital. Referring to slide 6, Ms. Ford echoed earlier
testimony that HB 118 authorizes local governments who collect
property taxes to choose to create a PACE program and allow
commercial property owners to opt-in.
8:12:29 AM
MS. FORD pointed out that the sectional analysis of HB 118 can
be found on slides 7-16, which she then proceeded to review.
The sectional analysis is included in the committee's packet.
8:21:34 AM
MR. THERRIAULT summarized that basically HB 118 allows local
governments with property tax powers the option to initiate a
PACE program if they so choose. The legislation simply provides
a tool for local governments to use to achieve lower energy
costs. The language includes a number of protections. For
instance, an owner of a commercial property with an existing
mortgage to Wells Fargo would have to ask Wells Fargo for
permission to initiate PACE financing. The aforementioned is
required because the PACE loan would become the superior lien on
the property while the Wells Fargo loan would become the
secondary lien. Across the nation, most often the property is
used as the collateral for the loan while the PACE financing
improves the efficiency and competitiveness of the commercial
property. Therefore, by and large many lenders are providing
that permission. Mr. Therriault related that because there was
concern there would be opposition from the lenders in the state,
he started a conversation with the Alaska Banking Association
early on in the process. The committee packet includes a letter
from the Alaska Banking Association that says it doesn't oppose
the legislation so long as it maintains the provision requiring
approval from the bank when there is an existing mortgage. He
then pointed out that a number of states learned that initiating
PACE without a certain number of requirements to provide
consistency across the state resulted in lenders being unable to
determine how PACE worked within the state, and thus lenders
weren't forthcoming with the loans. The aforementioned caused
Texas to modify its PACE program to achieve consistency across
the state. He noted that HB 118 is patterned after the Texas
statute.
8:25:09 AM
REPRESENTATIVE HUGHES related her understanding that state
funding pays for the energy audits of commercial buildings. She
then inquired as to how long the 150 audits of commercial
buildings that have already been done are valid and how much
such an audit costs. She further inquired as to how much
funding is available for the audit program now. She also asked
whether the state will be able to continue to offer the [energy
audit program].
MR. THERRIAULT said that he doesn't have that information and
deferred to Ms. Ford.
MS. FORD answered that through AEA's Energy Efficiency Program
there are funds available and another round of solicitation for
the commercial building energy audit is occurring. The funding
does come from AEA's Energy Efficiency Department. Ms. Ford
explained that the audits identify measures that would improve
the efficiency of the building. If no changes have been made to
the building since the audit, then the identified measures would
remain valid. Therefore, in such a situation Ms. Ford didn't
believe there would be an expiration date to the identified list
of projects that would improve the efficiency of the building.
She offered to provide the cost of the individual audits at a
later time.
REPRESENTATIVE HUGHES then requested the total amount in the
[Energy Efficiency Program] fund and the amount available.
8:28:53 AM
REPRESENTATIVE HUGHES directed attention to the language on page
3, line 7, of HB 118, which allows municipalities to designate
the boundaries of an area. The aforementioned ability could
result in municipalities providing an advantage to one portion
of the municipality over another. She inquired as to whether
there are any protections against the aforementioned and why the
aforementioned is even being allowed.
MR. THERRIAULT explained that a local governing body that
proposes PACE must first put forth a resolution regarding what
is being considered. An ordinance process with public
notification and input is then the next step prior to moving
forward with the program and identification of the region. He
reminded the committee that PACE is just for commercial
properties and thus the local governing body may want to
restrict the program to the portion of the region that contains
the commercial properties. Furthermore, there could be a
situation within the Fairbanks North Star Borough in which the
City of North Pole wants to move forward with the PACE program
while the City of Fairbanks does not. In the aforementioned
situation, the borough could work with the City of North Pole as
a designated area to allow PACE in that region while honoring
the decision of the City of Fairbanks to not offer the PACE
program. He reminded the committee that the debate would have
to take place at the local level, the assembly level, in terms
of why a particular designation is made.
8:31:28 AM
REPRESENTATIVE HUGHES inquired as to whether it would be
possible for a borough to decide that the entire borough would
be a PACE region, although a city within that borough chooses
not to participate.
MR. THERRIAULT confirmed that could be possible.
REPRESENTATIVE HUGHES maintained that she still doesn't see the
protection as the governing body could still choose to designate
one business district over another. She opined that it doesn't
seem problematic for an entire municipality to be the designated
region, particularly since it's an optional program.
MR. THERRIAULT remarked that he didn't know why a municipality
would want to favor one area over another as the program is a
mechanism to help all businesses. He related that the models he
has reviewed across the nation have left the [designation of the
region] to the local elected officials. However, he offered to
check with the national programs regarding whether the tendency
is the selection of one area or areawide.
8:33:54 AM
REPRESENTATIVE SEATON pointed out that [AS 29.10.200 is amended
to add PACE financing to the list of items in which] home rule
municipalities are allowed to engage. However, [AS 29.49.890]
of the legislation specifies that [the proposed PACE provisions]
apply to home rule or general law municipalities. He then
inquired as to why the first provision only applies to home rule
[municipalities].
MR. THERRIAULT clarified that the [proposed PACE program] is to
be available to any municipality that has any property powers.
He then noted that a Legislative Legal Services memorandum
addressing CSHB 118(ENE) indicates there might need to be
changes to the language to provide clarity in this matter. He
suggested that the committee is likely going to receive a
proposed committee substitute addressing the aforementioned.
8:35:15 AM
REPRESENTATIVE SEATON asked if the proposed PACE financing could
be used by only commercial properties to finance a distribution
system, while residences wouldn't have this mechanism available
to them. He then pointed out that the language refers to the
"useful life," which for a pipeline might be 30 years.
Therefore, a commercial building could have a much longer
timeframe.
MR. THERRIAULT stated that this mechanism wouldn't lend itself
to the financing of the actual distribution system, rather it's
only for loans to improve the property. [The improvements] have
to be fixed fixtures to the building, the envelope of the
building. Therefore, the PACE financing wouldn't lend itself to
the financing of an assessment by a local government on
distribution pipes going down the street. As Ms. Ford
explained, although PACE becomes a superior lien, the property
taxes and assessments placed on the properties by the local
government are ahead of the PACE financing. However, a local
improvement district in which all of the properties are being
assessed for the build-out of a distribution system would
actually be ahead of the special assessment for PACE in terms of
collection.
REPRESENTATIVE SEATON requested that the language be made
clearer as the language doesn't specify the improvements be on
the building envelope. He expressed the need to ensure that the
[PACE mechanism] is only used for what it is designed.
MR. THERRIAULT noted that the allowance of fees is to help the
property owner cover any expense they might have to put into the
energy audit engineering to do the improvements. Basically,
that expense is allowed to be capitalized as part of the
financing. He then directed attention to the definition on page
10, lines 8-11, which says:
"qualified improvement" means a permanent improvement
fixed to real property and intended to decrease energy
consumption or demand, including a product, device, or
interacting group of products or devices that uses
energy technology to generate electricity, provide
thermal energy, or regulate temperature;
MR. THERRIAULT stated that the aforementioned definition
wouldn't include the distribution system coming down the street.
8:39:47 AM
REPRESENTATIVE REINBOLD surmised that since there is no fiscal
note for HB 118, there will be no cost to the state at all. She
noted the lack of letters of support for HB 118. However, she
questioned who will pay for [the audits and financing]. She
then expressed concern with the use of the terms "impose" and
"imposing" in the title of the legislation and wanted assurance
that this isn't a situation in which big government is creating
more big government. She then inquired as to AEA's role in this
[program].
MR. THERRIAULT explained that AEA's role is to find mechanisms
to incent businesses to do the energy improvements in order to
achieve the 2010 energy efficiency goal. The term "impose" in
the title is used because the property owner, through a
contractual agreement with the local government, is agreeing to
have an assessment placed on their property tax bill. The
program, he reminded the committee, is completely voluntary for
the local government and local business. Furthermore, the banks
aren't required to provide the financing, rather the [program]
provides this optional tool. With regard to the fiscal note,
the local government has options [as to how to structure such a
program]. The legislation seeks to create a certain level of
uniformity to increase comfort of lenders with a statewide
program.
MS. FORD informed the committee that discussion with two other
states regarding the impacts on municipalities found that it
depends on the type of model the municipality choses to impose.
Minnesota chose to assess .5 percent interest on the financing
mechanism in order to cover the cost of the program. Minnesota
has been able to absorb the additional work through existing
staff. Minnesota has implemented the "Main Street Model," which
is designed very lean and has been very successful. On the
other side of the spectrum, Vermont has a statewide efficiency
utility. Therefore, a separate PACE staff and office were
established. As mentioned earlier, this is a voluntary
structure. She noted that application fees were purposefully
kept low while trying to pay for the cost of the program through
the application fees.
8:44:59 AM
REPRESENTATIVE REINBOLD restated her question regarding who will
pay for this, adding that she wants to be sure that isn't an
Environmental Protection Agency (EPA) at the local level.
Representative Reinbold stressed that the program doesn't sound
voluntary as it uses terms such as "impose." She also restated
the need to be sure the proposal in HB 118 isn't a growth in
government, particularly since there is a need to attract
businesses to the state.
MR. THERRIAULT responded that each local government will
determine whether it has funds for the program or whether the
program would be established as self-funding. As Ms. Ford
related, the language of HB 118 allows that when loans are made,
a percentage can be added to the interest of the loan to cover
the cost of the program. Therefore, the cost can be borne by
those who choose to apply for the loan to make the improvements.
In a situation in which there are no applications, there is no
income and no expense. The legislation, he reiterated, has been
structured to provide flexibility at the local government level.
The zero fiscal note reflects the intent that the state won't
contribute any funds to the operation of the local programs.
The legislation merely creates the mechanism by which the local
governments can decide how to cover the expense of the program.
8:47:53 AM
REPRESENTATIVE DRUMMOND related her appreciation with regard to
how the PACE program and financing works, particularly with the
use of the property tax mechanism that's already in place. She
related her understanding that HB 118 intends to encourage
commercial properties to participate in the energy efficiency
program. She then expressed concern with mixed-use properties
that have offices and private residences. For example, in her
neighborhood there is a 30-year old building that has several
stories of offices; office condominiums on the ground floor and
the second and third floors while the upper floors are
individually owned condominiums. She questioned whether the
PACE program has the flexibility to be adaptive to a joint
energy efficiency project such as the aforementioned building.
MR. THERRIAULT opined yes, and pointed out that the legislation
includes a language specifying that a multi-family dwelling with
four or more [units] does qualify as a commercial property and
for PACE financing. For instance, a building with mixed light
industrial or retail on the ground floor and more than four
residential units in the upper floors would qualify.
REPRESENTATIVE DRUMMOND surmised that the homeowners'
association would have to agree to the group financing
additions.
MR. THERRIAULT said he hadn't thought of the condominium
example, and thus he offered to obtain information on such a
situation from the national resources.
8:50:38 AM
REPRESENTATIVE NAGEAK remarked that fees are ubiquitous in an
individual's everyday life, and they are passed on from
businesses to customers.
MR. THERRIAULT explained that the fee language in HB 118 is
present to clarify that the local government has the option to
cover the cost of operating the program by charging fees. Local
governments that utilize the PACE mechanism will do so because
they want to help local businesses make energy efficiency
improvements. If fees are high and the PACE program is used as
a profit center, the expense to the businesses will be increased
to the point that they won't take out the loans. Since no
business can be forced to take out the loans, the aforementioned
would be self-defeating, he opined. Mr. Therriault related his
belief that the fees wouldn't get out of hand.
8:52:18 AM
REPRESENTATIVE SEATON directed attention the language "including
through lease" on page 7, line 23. He then asked how there
could be long-term financing for something acquired through a
lease.
MR. THERRIAULT related his understanding that the language
allows for improvements that can utilize equipment that is
leased. For instance, solar panels could be leased from a
provider that performs the maintenance on the panels while the
energy is provided to the building. He opined that the language
to which Representative Seaton's referring is to allow the
expense of adding such equipment to a commercial property in the
financing.
8:53:50 AM
REPRESENTATIVE SEATON inquired as to how that lease would relate
to PACE financing with regard to the potential indeterminate
term on the lease. He requested information regarding how a
lease would interact with PACE financing.
MR. THERRIAULT agreed to provide some specific examples
illustrating why the language was included in the legislation.
8:54:34 AM
REPRESENTATIVE HUGHES related her understanding that the
legislation doesn't require any state or local dollars and
allows private lenders and businesses to be in agreement. She
asked whether this program is viewed as an incentive and
business friendly. She then asked whether businesses have
specifically requested this program or shown interest in it.
MR. THERRIAULT confirmed that the legislation is trying to
create an incentive and be business friendly. He informed the
committee that he recommended the legislation be modeled after
the Texas program as many of the sensitives and pro-business
attitude in Texas are similar to those in Alaska. Furthermore,
through his participation as a board member of a national
organization of energy officials, he interacted with the
representative from Texas and determined that the Texas program
would be a good fit for Alaska and would be viewed as business
friendly. He noted that although he hasn't yet promoted this to
businesses, the head of the Alaska Municipal League (AML) has
previously related supported for this. He then noted that he
was sensitive to local lenders, and thus he worked with the
banking industry early on and received the letter of non-
objection so long as the protection provision is included. Mr.
Therriault directed attention to the language on page 9, line
28, that prohibits making "the issuance of a permit" contingent
on a business using PACE financing. The local government is
specifically not allowed to coerce businesses or lenders into
participating in the PACE financing. Again, the program
proposed in HB 118 is voluntary for local governments,
businesses, and lenders.
REPRESENTATIVE HUGHES requested information regarding what
businesses are thinking about HB 118.
8:58:42 AM
REPRESENTATIVE HUGHES emphasized that the state funding being
used for the audits may dry up. If the state funding is
eliminated, she asked whether PACE would allow the initial
audits to be covered through this program.
MR. THERRIAULT replied yes, and explained that the audits
required by the program can be rolled into the financing.
Therefore, the cost of the audit can be spread over a number of
years. The goal, he said, is to assure the annual energy
savings are larger than the costs to improve the building such
that the business sees immediate positive cash flow.
9:00:06 AM
REPRESENTATIVE DRUMMOND directed attention to the definition of
"real property" on page 10, lines 14-15, which says it "means
privately owned commercial or industrial real property". She
then pointed out that real property applies to residential
property as well. Therefore, the "real property" definition
would have to be expanded in order for the PACE program to apply
to the mixed use building example she referenced earlier.
Although multi-unit apartment buildings that are owned by a
single entity would qualify as commercial property, the
definition of "real property" would have to be expanded in order
for a group of individually owned condominiums that are located
in a building that has commercial property to qualify for the
PACE program.
9:01:33 AM
REPRESENTATIVE HUGHES recalled that mortgage lenders' have to
consent to the PACE financing since it would become the primary
lien. Therefore, she inquired as to whether lenders have not
given consent in other states.
MR. THERRIAULT acknowledged that lenders not giving consent to
PACE financing is a possibility. However, the experience
nationwide is that as the private lending institutions become
more comfortable with PACE financing, more approval is
occurring. Most often the property itself is the collateral for
the commercial loan on the business and through the PACE
financing that collateral is being improved. He opined that the
lenders understand that both the physical asset and financial
viability of the business using that asset is being improved.
The aforementioned, he opined, is why PACE is gaining traction
across the nation. Still, there are no guarantees that
individual banks will approve this financing mechanism.
9:03:14 AM
REPRESENTATIVE SEATON questioned whether designating an entire
municipality [as eligible for PACE financing] would expand the
necessary funds such that the municipality's reserves might not
be sufficient to provide financing. He agreed with
Representative Hughes that the picking of winners and losers
shouldn't occur, but requested analysis regarding whether the
financing would be limited [by designating an entire
municipality as eligible for PACE financing].
9:04:33 AM
CHAIR TILTON announced that she was passing the gavel to
Representative Seaton and intended to hold HB 118.
9:05:00 AM
VICE CHAIR SEATON opened public testimony.
9:05:18 AM
CHRIS ROSE, Executive Director, Renewable Energy Alaska Project
(REAP), began by informing the committee that REAP is a
nonprofit coalition of over 80 organizations around the state
that all support renewable energy and energy efficiency. Mr.
Rose said REAP has been promoting the idea [embodied in HB 118]
for several years and is in full support of HB 118. He stressed
that the state is in a fiscal crisis and a lot of money is
needlessly being wasted on energy costs. Collectively, those in
the state are spending $5-6 billion on energy, including
transportation, heat, and electricity. The State of Alaska's
utility bill is about one-tenth of the collective costs, an
estimated $642 million for heat and electricity. From the
existing [energy efficiency] programs, such as the residential
weatherization program that has saved over 30 percent in energy
costs, a conservative estimate for saving energy for buildings
is 20 percent. A savings of 20 percent of $5-6 billion per year
on energy efficiency keeps $1 billion a year circulating in the
state. Commercial buildings are a big portion [of energy costs
in the state]. The commercial sector has been left out of
energy efficiency programs, which is why this makes sense, he
said. With the banks' involvement, the financing is almost
unlimited and the goal is for the [commercial buildings that
avail themselves of the PACE financing] to obtain positive cash
flow from the beginning. He noted that over 30 states [offer
PACE financing]. In fact, the idea of property assessed clean
energy was originally conceived for residential consumers.
However, the Federal National Mortgage Association (FNMA) known
as Fannie Mae and the Federal Home Loan Mortgage Corporation
(FHLMC) known as Freddie Mac didn't like that the local property
tax assessment district has the superior lien because they buy
most of the mortgages in the country. The aforementioned is why
the program isn't designed for residences. Still, the [PACE
program] makes a lot of sense, he opined, particularly in terms
of the jobs that would be created through the retrofits of these
[commercial] buildings. He informed the committee that 4,000
jobs have been created through the residential weatherization,
but now those folks are concerned with the declining funding for
the residential program. This legislation would be one way in
which those folks could keep their jobs because the same skills
they are using in the residential sector can be used in the
commercial sector. Mr. Rose then highlighted that under this
proposed financing the loan goes with the building, and thus one
doesn't have to worry whether the return on investment occurs
during ownership because the next owner of the building will see
a building that is more attractive since it's worth more and
more energy efficient. In conclusion, Mr. Rose encouraged the
committee's support for HB 118.
9:09:44 AM
REPRESENTATIVE DRUMMOND inquired as to how this legislation
could benefit mixed use properties.
MR. ROSE said he couldn't speak to whether Fannie Mae or Freddie
Mac have any involvement in mixed use loans, but he didn't
believe they do. He opined that a mixed use building likely has
a commercial loan and wouldn't be involved with Fannie Mae or
Freddie Mac, and thus this financing would be available.
REPRESENTATIVE DRUMMOND asked if that would be the case even
with a collection of separate owners. For example, a building
in her district has 16 residential condominiums and 4-5 office
condominiums all of which are owned by different entities and
are financed separately.
MR. ROSE opined that a lot of the physical plan of the building
is operated by one entity. The building likely has one large
heating and cooling system and whoever owns and pays for that
would take the PACE loan. He related his assumption that the
energy costs are passed on to those in the building, but said he
would have to see how the building is set up to answer.
REPRESENTATIVE DRUMMOND related her understanding from the
online property tax assessments that this building is all
electric, and therefore it's ripe for this kind of improvement.
Still, Representative Drummond said she didn't see how the
program proposed in HB 118 would cover this building unless the
definitions in the legislation are changed to include multi-
owner and multi-use facilities.
MR. ROSE stated his agreement that it's important to expand the
definition because the only limitation on using the PACE
financing in residential areas has been at the federal level
with Fannie Mae and Freddie Mac.
9:13:04 AM
VICE CHAIR SEATON questioned why one would assume that all
Alaskans that could benefit from the PACE program are financing
through Fannie Mae or Freddie Mac. He further questioned why a
definition would be used that precludes all residential
properties as if all of them were financed through Fannie Mae
and Freddie Mac because there could be situations in which
people have paid off their loans or utilize different financing.
Therefore, Representative Seaton requested that Mr. Rose and the
group that's working on this consider the aforementioned and
whether the definition is constructed for reasons other than the
program.
MR. ROSE related his belief that has been considered because
even if one doesn't initially finance through Fannie Mae and
Freddie Mac, most residential mortgages are ultimately held by
Fannie Mae and Freddie Mac. He opined that the desire is to
support a discreet program now and hopefully work with Congress
and the president to tell Fannie Mae and Freddie Mac to allow
this as it improves the collateral, whether it's a commercial or
residential property.
VICE CHAIR SEATON reminded the committee that one of the reasons
Alaska wasn't so caught up in the sub-prime mortgage crisis was
because the Alaska Housing Finance Corporation (AHFC) holds the
paper in the state rather than being sold to others. Therefore,
he requested the aforementioned be considered in order to ensure
Alaskans aren't being denied a possibility with AHFC.
9:16:02 AM
VICE CHAIR SEATON, upon determining no one else wished to
testify, closed public testimony and announced that HB 118 would
be held over.
| Document Name | Date/Time | Subjects |
|---|---|---|
| HCS HB 118 (ENE) Sectional Analysis.pdf |
HCRA 3/26/2015 8:00:00 AM |
HB 118 |
| HCS HB 118 (ENE) Hearing Request Letter.pdf |
HCRA 3/26/2015 8:00:00 AM |
HB 118 |
| HB0118B.PDF |
HCRA 3/26/2015 8:00:00 AM |
HB 118 |
| HB0118-1-2-021815-CED-N.PDF |
HCRA 3/26/2015 8:00:00 AM |
HB 118 |
| 15 3 4_IGU Supports PACE Act.pdf |
HCRA 3/26/2015 8:00:00 AM |
HB 118 |
| HB 118, PACE HCRA 03 26 15.pdf |
HCRA 3/26/2015 8:00:00 AM |
HB 118 |
| HB 118, Supporting Document - Alaska Bankers Association.pdf |
HCRA 3/26/2015 8:00:00 AM |
HB 118 |
| Mayor Eberhart CIty of Fairbanks.pdf |
HCRA 3/26/2015 8:00:00 AM |
HB 118 |
| REAP Support PACE Financing, HB 118.pdf |
HCRA 3/26/2015 8:00:00 AM |
HB 118 |
| Mayor Hopkins FNSB.pdf |
HCRA 3/26/2015 8:00:00 AM |
HB 118 |
| HB 149, Supporting Document - Flow Chart, Quorum Requirements.pdf |
HCRA 3/26/2015 8:00:00 AM |
HB 149 |
| HB 149 Sponsor Statement.pdf |
HCRA 3/26/2015 8:00:00 AM |
HB 149 |
| HB 149 Sectional Analysis.pdf |
HCRA 3/26/2015 8:00:00 AM |
HB 149 |
| HB149-DCCED-CBPL-03-20-15.pdf |
HCRA 3/26/2015 8:00:00 AM |
HB 149 |